The State of Frisco Real Estate
As a Realtor, I'm always being asked "How's Real Estate in the Dallas area?" I think, a lot of the time, people are expecting me to say that the end is coming and I'm jumping ship. At least, that's what you'd think listening to the national press.
But my answer is "Fantastic, we are on the verge of exciting and exploding times here."
Here's the general scoop on Real Estate in the Dallas area:
* Appreciation in the Dallas area has held at a steady 5-6% growth for quite a few years now. While there have been some slight regional hiccups, like the airline downsize effecting areas west of the North Dallas Tollway, and the Telecom bust effecting the telecom corridor in Richardson and Allen, Dallas has not seen the super appreciation that the coasts, and much of the rest of the country has, but we have not seen a depreciation of any sort either. It should be noted, that there are areas of fairly substantial appreciation in Dallas. Areas between Hwy 75 and I-35, between Downtown and I-635, have seen appreciation rates as high as 15% in some areas, and of course, Preston Hollow, University Park, and Highland Park would be some of those areas. (Did I mention my sites, HighlandParkRealtor.com and PrestonHollowRealtor.com ?)
* Several things have happened on the national level that is now affecting Dallas.
First, baby boomers are getting older. That means that the most affluent generation of America's history is settling down, which means, downsizing to condo's, townhouses, zero line lot homes, lake homes, second homes, and vacation homes. This is why some of the hype of a housing bubble is unfounded. (I don't believe in housing bubbles at all - stocks may bust, but homes simply deflate (with the exception of natural disasters and government intervention, of course).
Second, a lot of those baby boomers, and people from both coast, are deciding that a warm climate with not to little natural disasters in a undervalued housing market with no state income tax sounds pretty good. And they, my friend, coming (and with lots of cash from the appreciation they made).
Third, a recent nationally publicized study found that Dallas and Ft. Worth were 2 of the top three undervalued real estate markets in the country. Think that caught the ear of investors everywhere? How about the great job growth? (I heard that it was the second best job growth in the nation.) Dallas is at the start of an invasion of home investors, and let me tell you, they are already here. Ask any new home builder in Frisco or McKinney, or any condo developer in Downtown Dallas, and they'll tell you they are knee deep in Yankees, hippies, and people with a foreign accent. I was on an investors club board in California recently, and, I kid you not, HALF of the messages were about buying homes in Texas (Austin is a really hot market too.)
Forth, speaking of a foreign accent, there is a world effect descending upon the Dallas area. With the rise of democracy in Russia and China, some people are starting to make some money over there, but they sure don't trust the banks. So, where's the safest investment vehicle in the world? You guessed it, right here in America, and even better, Dallas. How exciting for a Chinese national to come home and tell everyone that they bought some homes just minutes from J.R.'s place! Oh, and did I mention the weak dollar? That's making us an even better deal.
* Back to Dallas - although Big D's still fighting the black eye of a high crime rate and is gaining national recognition for its City Counsel that often resembles the Jerry Springer Show, financial leaders like Tom Hicks, Tramel Crow, and a thousand hard as nails developers and entrepreneurs are continuing to transform the city and its suburbs into a dynamic, culturally diverse, and vibrant city. I was born and raised in Dallas, Richardson, Garland, and Frisco, and let me tell you, it wasn't always such an exciting place to be. Think pre-1990, or maybe a little before then. There was nothing dynamic or exiting about the Dallas skyline, not neon lights, no Deep Elum, no West End, no State Street condos, no McKinney Avenue restaurant scene, no European Retail/housing villages, and Frisco was a great place for farming and hunting.
Currently, there are about a dozen high rise condo conversions taking place in the Downtown Dallas area, including the Ritz, and the just opened "W" Hotel and condos. If the City can get their act together, we'll be starting the building of a 10 Story high architecturally significant bridge across the Trinity, and then development of the Trinity itself.
Oak Cliff, 10 minutes from Downtown and filled with huge mature trees is being transformed by individual investors and developers into a kind of a quaint, old, ethnically diverse place that's perfect for the thirty-forty something crowd who still have a deep desire to be hip, but can't quite see themselves in a condo.
* Lets move on to Frisco. One of the surprises for out of state relocations and investors is our high property tax rate. Yes, there's no income tax in Texas, but that's kind of inconsequential for an out of state investor. And what about Tennessee, where there's no state income tax AND low property taxes? Lets face it, property taxes hurt...property, and investment, and appreciation, and, yes, Tax Revenue (something I've never been able to get my liberal friends to understand). Currently, Frisco enjoys one of the lowest property tax rates in D/FW (2.32-2.41% depending upon the County), thanks to a retail tax revenue that, at last count was over $25,000,000 a year, and the conservative and sane council members we enjoy in Frisco and thank the Lord for every time we see a Dallas City Council meeting on T.V. That's about $950 per $100,000 in value an investor sees in his pocket when he buys a home in Frisco instead of McKinney, Dallas, or one of the other 2.8% plus cities.
* Behold, the North Dallas Tollway Completion! Well, its not here yet, but the North Dallas Tollway extension to Hwy 380 at the Frisco/Prosper border is expected to be completed by 2007, and the last I heard, they were 6 months ahead. And what does this spell for Frisco? Appreciation my friend, Appreciation with a capital "A" (to the tune of Music Man). Lets take a look at some statistics from the North Texas Real Estate Information System. In the area from Hwy 121 to 380, roughly a mile in either direction, there were 607 properties sold in 2005, with an average sales price of $372,157, and an average price per sq. ft. of $113. (by the way, the largest sale was 9,311 sq. ft. with a price of $3,000,000.) To date, 2006 shows 281 properties sold with an average sales price of $384,524, and an average price per sq. ft. of $115. I know, I know, some of you more savy investors who attended Highland Park schools are saying "hey, wait a minute, that's only 3% appreciation." Well, although some people figure it that way, it's not a barometer of inflation at all, because it doesn't measure an increase in price on the same homes. Personally, I have not found a great, and accurate way to measure the appreciation in a given area, short of a Metropolitan Statistical Area, which is huge. However, the best method I have, indicates appreciation rates up to 11% in some areas along that corridor, and I'm seeing rental signs poping up like Johnson grass in my neighborhood in the same area, which ought to tell you something (investors).
If you'd like to buy or sell your own piece of the pie in Frisco, or anywhere else in the Dallas area, give me a call and I'll help you to navigate the scenery and scam artist along the road.
-Brian Marsh is a Realtor, Frisco resident, native Dallasite, and Editor of the Frisco Real Estate Blog. If you'd like to contact Brian you can reach him through his website, http://www.aggresivehomesales.com/ or by phone at 214.520.
But my answer is "Fantastic, we are on the verge of exciting and exploding times here."
Here's the general scoop on Real Estate in the Dallas area:
* Appreciation in the Dallas area has held at a steady 5-6% growth for quite a few years now. While there have been some slight regional hiccups, like the airline downsize effecting areas west of the North Dallas Tollway, and the Telecom bust effecting the telecom corridor in Richardson and Allen, Dallas has not seen the super appreciation that the coasts, and much of the rest of the country has, but we have not seen a depreciation of any sort either. It should be noted, that there are areas of fairly substantial appreciation in Dallas. Areas between Hwy 75 and I-35, between Downtown and I-635, have seen appreciation rates as high as 15% in some areas, and of course, Preston Hollow, University Park, and Highland Park would be some of those areas. (Did I mention my sites, HighlandParkRealtor.com and PrestonHollowRealtor.com ?)
* Several things have happened on the national level that is now affecting Dallas.
First, baby boomers are getting older. That means that the most affluent generation of America's history is settling down, which means, downsizing to condo's, townhouses, zero line lot homes, lake homes, second homes, and vacation homes. This is why some of the hype of a housing bubble is unfounded. (I don't believe in housing bubbles at all - stocks may bust, but homes simply deflate (with the exception of natural disasters and government intervention, of course).
Second, a lot of those baby boomers, and people from both coast, are deciding that a warm climate with not to little natural disasters in a undervalued housing market with no state income tax sounds pretty good. And they, my friend, coming (and with lots of cash from the appreciation they made).
Third, a recent nationally publicized study found that Dallas and Ft. Worth were 2 of the top three undervalued real estate markets in the country. Think that caught the ear of investors everywhere? How about the great job growth? (I heard that it was the second best job growth in the nation.) Dallas is at the start of an invasion of home investors, and let me tell you, they are already here. Ask any new home builder in Frisco or McKinney, or any condo developer in Downtown Dallas, and they'll tell you they are knee deep in Yankees, hippies, and people with a foreign accent. I was on an investors club board in California recently, and, I kid you not, HALF of the messages were about buying homes in Texas (Austin is a really hot market too.)
Forth, speaking of a foreign accent, there is a world effect descending upon the Dallas area. With the rise of democracy in Russia and China, some people are starting to make some money over there, but they sure don't trust the banks. So, where's the safest investment vehicle in the world? You guessed it, right here in America, and even better, Dallas. How exciting for a Chinese national to come home and tell everyone that they bought some homes just minutes from J.R.'s place! Oh, and did I mention the weak dollar? That's making us an even better deal.
* Back to Dallas - although Big D's still fighting the black eye of a high crime rate and is gaining national recognition for its City Counsel that often resembles the Jerry Springer Show, financial leaders like Tom Hicks, Tramel Crow, and a thousand hard as nails developers and entrepreneurs are continuing to transform the city and its suburbs into a dynamic, culturally diverse, and vibrant city. I was born and raised in Dallas, Richardson, Garland, and Frisco, and let me tell you, it wasn't always such an exciting place to be. Think pre-1990, or maybe a little before then. There was nothing dynamic or exiting about the Dallas skyline, not neon lights, no Deep Elum, no West End, no State Street condos, no McKinney Avenue restaurant scene, no European Retail/housing villages, and Frisco was a great place for farming and hunting.
Currently, there are about a dozen high rise condo conversions taking place in the Downtown Dallas area, including the Ritz, and the just opened "W" Hotel and condos. If the City can get their act together, we'll be starting the building of a 10 Story high architecturally significant bridge across the Trinity, and then development of the Trinity itself.
Oak Cliff, 10 minutes from Downtown and filled with huge mature trees is being transformed by individual investors and developers into a kind of a quaint, old, ethnically diverse place that's perfect for the thirty-forty something crowd who still have a deep desire to be hip, but can't quite see themselves in a condo.
* Lets move on to Frisco. One of the surprises for out of state relocations and investors is our high property tax rate. Yes, there's no income tax in Texas, but that's kind of inconsequential for an out of state investor. And what about Tennessee, where there's no state income tax AND low property taxes? Lets face it, property taxes hurt...property, and investment, and appreciation, and, yes, Tax Revenue (something I've never been able to get my liberal friends to understand). Currently, Frisco enjoys one of the lowest property tax rates in D/FW (2.32-2.41% depending upon the County), thanks to a retail tax revenue that, at last count was over $25,000,000 a year, and the conservative and sane council members we enjoy in Frisco and thank the Lord for every time we see a Dallas City Council meeting on T.V. That's about $950 per $100,000 in value an investor sees in his pocket when he buys a home in Frisco instead of McKinney, Dallas, or one of the other 2.8% plus cities.
* Behold, the North Dallas Tollway Completion! Well, its not here yet, but the North Dallas Tollway extension to Hwy 380 at the Frisco/Prosper border is expected to be completed by 2007, and the last I heard, they were 6 months ahead. And what does this spell for Frisco? Appreciation my friend, Appreciation with a capital "A" (to the tune of Music Man). Lets take a look at some statistics from the North Texas Real Estate Information System. In the area from Hwy 121 to 380, roughly a mile in either direction, there were 607 properties sold in 2005, with an average sales price of $372,157, and an average price per sq. ft. of $113. (by the way, the largest sale was 9,311 sq. ft. with a price of $3,000,000.) To date, 2006 shows 281 properties sold with an average sales price of $384,524, and an average price per sq. ft. of $115. I know, I know, some of you more savy investors who attended Highland Park schools are saying "hey, wait a minute, that's only 3% appreciation." Well, although some people figure it that way, it's not a barometer of inflation at all, because it doesn't measure an increase in price on the same homes. Personally, I have not found a great, and accurate way to measure the appreciation in a given area, short of a Metropolitan Statistical Area, which is huge. However, the best method I have, indicates appreciation rates up to 11% in some areas along that corridor, and I'm seeing rental signs poping up like Johnson grass in my neighborhood in the same area, which ought to tell you something (investors).
If you'd like to buy or sell your own piece of the pie in Frisco, or anywhere else in the Dallas area, give me a call and I'll help you to navigate the scenery and scam artist along the road.
-Brian Marsh is a Realtor, Frisco resident, native Dallasite, and Editor of the Frisco Real Estate Blog. If you'd like to contact Brian you can reach him through his website, http://www.aggresivehomesales.com/ or by phone at 214.520.
posted by Beth at 10:03 PM
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